October 8th Week in Review - Skewing the Data
This week was "Jobs Report" Week. The top read columns on this website are those that are jobs related. The August Jobs Report was bad - they skewed the data higher than it should have been with an artificial seasonal factor for the Current Employment Statistics (CES) data. They did it again this month. This was expected and projected.
(Oct 3) The Week started with the September Jobs Report Forecast Column. "September Should Be A Job Loss Month" was subtitled "Seasonal Factors Matter." It was thought that we should see a drop in full-time jobs, an increase in part-time jobs, a drop in unemployed workers, a drop in the unemployment rate and a drop in the participation rate, all non-seasonally adjusted. It was thought that the authors of the report would manipulate the seasonal factors that are used to convert the non-seasonally adjusted Current Employment Statistics (CES) data to the reported Seasonally Adjusted CES data. The only question was how high would the seasonal factor be?
(Oct 4) last week this column got a little busy and ignored the weekly unemployment claims report. This should not be a surprise as "everyone else" has forgotten about it. "Unemployment Claims Limbo - How Low Can They Go?" detailed how the NSA First-time Unemployment (FTU) claims level was at a 16 year low and the Continuing Claims data was near a 16 year low for the final week of September. This is not a good thing. Read the column and prior columns to understand how these reports are understating the weakness in the economy.
(Oct 5) Seasonal Factors are the lifeblood of government economists. Seasonal factors can turn job losses into job gains. They can inflate or deflate unemployment claims numbers. They can make or break streaks ."September Seasonal Factor Creep" details how the September data is being more and more manipulated every year. This column will explain why I rarely trust any seasonally adjusted data.
(Oct 6) There are times when this column attempts to connect the dots between various reports. It is easy to connect the dots between Retail Sales and Inflation. It is easy to connect the dots between Tax Revenue and Retail Sales. It became obvious that I needed to produce a column on the CPI (Consumer Price Index) data that was released last month as people were discussing rising medical care costs and rising health insurance premiums. This data is seasonally adjusted in so many ways that multiple comparisons have to be made. Suffice it to say that "gasoline savings" we are seeing cannot be "saved" if shelter and medical costs are rising. "August Shelter Costs Offset Energy Savings" details how medical costs and medical insurance costs are exceeding the base rate of inflation.
(Oct 6) If no news is good news then the Weekly Jobs Report must be "great" news. "No News Unemployment Claims News" details how the First-time Unemployment Claims streak is invalid and how the SA FTU number could have been reported significantly higher if it was reported at all.
(Oct 7) This Jobs Report underwhelmed. September is a jobs loss month. This September was worse than is being reported elsewhere. We lost over 1 mill full-time jobs. We gained over 1 million part-time jobs. The number of unemployed fell. The participation rate fell. If seasonal factors from September 2012 were used we would have reported only 33,000 Private Sector Workers joining the workforce, even though we really lost 457,000 NSA Private Sector Workers. "September Jobs Report - Down is Up" details how we are adding fewer private sector workers this year than we added during 2011, 2012, 2013, 2014, or 2015.
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